UniCredit 4Q Hit by Impairments, Provisions -- Earnings Review
11 Februar 2021 - 2:49PM
Dow Jones News
By Pietro Lombardi
UniCredit SpA released its fourth-quarter results late on
Wednesday. Here is what you need to know.
NET LOSS: The Italian bank posted a quarterly loss of 1.18
billion euros ($1.43 billion). This compares with a EUR835 million
loss a year earlier and analysts' expectations of a EUR717 million
loss.
REVENUE: The bank's revenue fell almost 13% on year to EUR4.24
billion. Analysts had expected revenue of EUR4.29 billion.
WHAT WE WATCHED:
-RETURNS TO SHAREHOLDERS: Overall, UniCredit plans to distribute
EUR1.1 billion to shareholders in 2021, via a mix of cash dividend
and buybacks. Buybacks should make up around EUR800 million of the
planned distribution, with cash dividend accounting for the
remaining EUR300 million.
-BAD-LOAN PROVISIONS AND IMPAIRMENTS: The fourth-quarter net
loss was worse than expected, dragged by impairments. The lender
posted a EUR878 million impairment related to its
corporate-and-investment banking unit.
Bad-loans provisions of EUR2.06 billion were 25% higher than in
the same period last year but below the EUR2.27 billion analysts
had forecast.
-TARGETS: For this year, the bank targets an underlying net
profit of more than EUR3 billion, while revenue and costs are
expected to be in line with previous guidance. Cost of risk should
be close to 70 basis points.
The bank delivered an underlying profit of EUR1.3 billion for
last year, beating its guidance of more than EUR800 million. Cost
of risk was 105 basis points, at the lower end of its guidance.
Costs for the year fell 1.2%.
Write to Pietro Lombardi at pietro.lombardi@wsj.com;
@pietrolombard10
(END) Dow Jones Newswires
February 11, 2021 08:34 ET (13:34 GMT)
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